UPDATE 3-Ladbrokes on track but Paddy Power hit by tax hike
* Ladbrokes trading within market expectations for 2008
* Ladbrokes group profit up 10 percent
* Paddy Power says increased taxation to hit 2009 profits
* Paddy Power shares down 8 percent
* Fears of increased UK betting tax
(Incorporates Paddy Power results, adds Ladbrokes CEO, analyst comment, further detail, shares)
LONDON, Nov 13 (Reuters) - Britain's biggest bookmaker Ladbrokes (LAD.L) said on Thursday it expected 2008 earnings to fall within the range of analysts' forecasts, despite a run of unfavourable sporting results in October.
Shares in Ladbrokes rose as much as 4 percent in a falling market but Irish counterpart Paddy Power (PAP.L) slid upto 8.5 percent after it warned increased betting taxes in Ireland would cut operating profit next year by 9 million to 10 million euros ($11.2 million to $12.5 million). Ladbrokes, which has about 2,600 betting shops, said group profit excluding high-stakes gambling rose 10 percent in the four months to Oct. 31. Profit from high rollers placing big bets was 17 million pounds.
Ladbrokes said in a trading statement that over-the-counter gross win was flat, having been significantly hit by recent results which favoured punters rather the bookmaker.
"Although a run of poor football and horse race results at the end of the period has affected performance, the group remains within the market expectation range for 2008," said Chief Executive Chris Bell.
Analysts' expectations for 2008 pretax profit range between 174.6 million and 223 million pounds, according to a 17 forecasts compiled by Reuters Estimates.
Bell told reporters the poor results included the UEFA Cup, where 14 out of 16 favourites won games, and the Breeders Cup meeting in the United States where five out of the nine races were won by European horses.
Excluding the impact of high rollers, group gross win -- total bets minus payouts -- increased by 12 percent over the four months.
"To Ladbrokes' credit, not many companies are reporting growth of 12 percent in the current market conditions," said Investec analyst Matthew Gerard.
Ladbrokes said that while its gross win margin was up over the period, the amounts staked fell. That was interpreted by some analysts as a sign that the impending recession in Britain may be starting to have an impact. Continued...
